Ichimoku Analysis (Weekly chart)
Tenken-Sen- $1780
Kijun-Sen- $1875
Gold price took support near 200- W EMA and surged more than $50 on the weak US dollar. Steep fall in US 10-year bond yield to 2.789% has increased inversion to 20 bpbs. A hawkish hike by ECB also puts pressure on the US dollar. US dollar index pared most of its gains after hitting a multi-year high of 109.29. According to the CME Fed watch tool, the probability of a 75 bpbs rate hike in Jul rose to 78.7% from 70.9% a week ago.
The number of people who have filed for unemployment benefits rose by 7000 last week to 251000 compared to a forecast of 240K. US Philly fed manufacturing contracted for a second consecutive month to -12.3 in Jul. US flash manufacturing PMI for Jul dropped to 47.50 compared to a forecast of 52.6.
Factors to watch for gold price action-
Global stock market- Bullish (negative for gold)
US dollar index – Bearish (Positive for gold)
US10-year bond yield- Bearish (Positive for gold)
Technical:
The near–term support is around $1680, a breach below targets $1650/$1600.Significant reversal only below $1600. The yellow metal faces minor resistance around $1740, breach above will take it to the next level of $1760/$1770/$1800.
It is good to sell on rallies around $1728-30 with SL around $1750 for TP of $1650/$1600.
